Property Investment Suburbs In America
Many of us dream of living the ideal American life with two children, with a dog and a cat, and a station wagon in a house with a white picket fence.
The 1920’s version of the American Dream is still possible in the 21st century.
This simple suburban family lifestyle is the dream of many.
We feel tired of living in our condos, terrace, and townhouses where everything is hemmed in. There is no space to park an extra car.
Much less for a baby carriage, extra bicycles for the kids, luggage, and even fitting in a second golf bag is challenging.
There is nowhere to allow your kids to run around the streets.
Is this the childhood you want your kids to grow up and experience in Malaysia or Singapore?
Most of the time, they’re stuck at home with their apps and devices?
As cities in Asia grow, living becomes unhealthier and stressful.
You’re forced to spend money on groceries and necessities that you could grow yourself.
How many of us feel that we want to harvest our vegetables and herbs for dinner but can’t.
What is the lifestyle of a Million Dollar home in Singapore or Malaysia?
I think it’s normal to say that you probably dream of living behind “bars” in a guarded gated community.
If this is not what you want, you can still change it.
American Suburbs Are The Best Small Towns
The world of American television has brought us plenty of fascinating small towns where we’d love to lay down roots.
We dream of the idyllic farmhouse of Green Gables, with lush fields of wildflowers.
Or better still, maybe your dream is to live in Smallville, Kansas, a town with its very own superhero! Clark Kent — better known as the one and only Superman!
It’s possible to find the best small towns in America.
These are the cities with less than 25,000 residents, beautiful scenery, cultural amenities, great restaurants, and outdoor activities.
The ideal small town is Mayberry’s fictional TV town, a tight-knit community with low crime, a slower pace, and wholesome fun.
It is possible to find this dream location.
You can uncover places where life can still be simple, quiet, and complete, but with more places for folks to gather than just a barbershop.
But – for Property Investment, you will want to find the American Suburbs that has the best population growth.
At Noble Sky, use these factors to help you think as you research homes to buy in the US.
Buying older homes and brand new ones each have their pros and cons.
Above all, the most important are the following factors:
- the population’s median household incomes
- home prices
- good schools
- crime rates
- unemployment rates
- average commutes
- distances to large cities
What we found are cities small in population yet big for their quality of life.
These are the places that people want to live in.
Dreaming The American Suburban Lifestyle
The homes in the suburbs are precise as you’ve seen them on American TV shows.
There is a garden space around each property.
There are shady trees and flowering shrubs.
There are no high 8 feet high boundary walls or metal grilles.
The kids can ride their bikes on the wide pavement.
You have a garage to keep your car. There is a garden shed for tools.
You can have a small garden.
Raise some chickens for organic eggs.
The dream list goes on.
You ever wanted to do all the things at home, but you can’t because of a lack of space here.
What Is The Cost Of Building A Home?
Wherever you live, the cost of owning a home has escalated over the last few decades.
In recent years the cost not only doubles, but it has also tripled and even quadrupled when salaries have not risen in comparison.
So what do you do when your dreams of owning a home get pushed aside.
Many of us in Asia live in apartments and those who do better live in condominiums.
Even those who live in luxurious high rise blocks yearn for a landed house.
The cost of owning such a home is astronomical.
For comparison, let’s assume the property is a single-story house with a decent compound around it.
- 3 Bedrooms
- 2 Bath
- 1 Lounge
- 1 Dining
- 1 Kitchen
What Is A Bungalow?
In Singapore and Malaysia, a bungalow is a house built in the middle of a land plot.
There are many different real estate definitions for bungalow nowadays.
Some developers have turned to even calling a corner terrace a “Corner Bungalow.”
I will reiterate that a terrace house is a terrace house, and a semi-detached cottage is a semi-detached house.
They cannot miraculously morph into a bungalow, no matter how much renovation you decide to invest in it.
In real estate and property investment, a bungalow is a low rise detached house, either a single-story or has a second story built into a sloping roof (an attic with dormer windows).
What Is A Renovated Bungalow?
A basic bungalow usually maintains its original structure.
The first owner or the seller did not renovate or improve the building, therefore earning the term “basic bungalow.”
The Renovated Bungalow is after the Basic Bungalow is sold and the new owners tear down the building and rebuild from bottom-up.
Sometimes they maintain the structure internally but may make improvements to renovate and extend around the frame.
A car porch is sometimes added or even garden sheds or other small structures.
New alterations and additions (A+A) involve increasing the usable space or built-up area.
The value of the bungalow will appreciate these new renovations carried out to the buyer’s taste.
Beautiful Garden Vs. Magnificent View Which Will You Choose?
Ideally, you will want to buy a bungalow on a land level, not in any danger of flooding.
Even if the bungalow is constructed on flat land, the next question is the available space on the ground.
Some bungalows have a considerable footprint and take up all the land with little or no garden.
In Singapore and Malaysia, this is quite common to see colossal car porches for many cars and a tiny strip for a planter box on the property’s edge.
There are also bungalows with a vast garden and a lot of land behind it for future expansion.
Bungalows built on the hill present magnificent views from top-down and its beautiful surroundings.
Adding Swimming Pool, Tennis Court, And Even A Private Lift
I’m sure you have all seen celebrities’ fantastic homes and the rich and famous where a small bungalow can grow with many new additional features.
These can range from adding
- a simple porch
- a garage
- full basement
- swimming pool
- a water feature
- tennis courts
- squash court
- gym facilities
- wine cellar
- a private lift that is wheelchair-friendly
for any elderly family member(s).
Not to mention the addition of many bathrooms, ensuite and walk-in wardrobes!
Not many owners prefer to have a swimming pool because of the maintenance costs associated with it.
Living In A Guarded, Gated Master Planned Community
Living in Singapore and Malaysia for the wealthy is a lot different than in America.
Singaporeans and Malaysians prefer a high-security level and like to live in bungalows built in a gated and guarded, master-planned community.
The bungalows with individual designs are not built by individual homeowners but by a master developer.
Buyers can find a 2-story bungalow, a 3-story bungalow, or even a 4-story bungalow swimming pool and private lifts along the same road.
Let’s look at the cost of a bungalow in Singapore, Malaysia, and Southeast Asia.
The data is sourced from Online Properties sites.
Home Cost In Malaysia
We will look at the cost of a single-story bungalow in a few cities in Malaysia for a start.
For Malaysians, the dream of building their own bungalow from scratch is a bold decision.
Most prefer to upgrade and rehab their older home rather than to move to a new neighborhood.
Malaysians are sentimental – the older generations like the communities they live in rather than moving to a new place.
Even if this means building their dream house by squeezing a massive hon a tiny lot.
Never mind if there is no garden and their house butt right up to their neighbors’ home.
You have to understand that constructing your own home is very different from buying one from the developer.
A property’s selling price and its construction cost could vary greatly.
Primarily these are the factors that affect the costs
- land cost
- build quality
- quality of fixtures and fittings.
To provide some context, according to the National Property Information Centre (NAPIC) – The 2018 median price of a house in Selangor is RM382,000, while in Perak, it is RM210,000.
The home construction cost for various residential landed property types per sq. ft (PSF) differs significantly for Malaysia’s top 5 cities.
These data points (average sum) are based on the latest fixed construction tender prices in the market.
- Kuala Lumpur- RM381/PSF
- Johor Baru – RM353/PSF
- Penang – RM300/PSF
- Kota Kinabalu – RM382/PSF
- Kuching – RM366/PSF
Home Cost In Singapore
There are about one million or so homes in Singapore that comprise mostly high-rise homes – condominiums, apartments, and public housing flats.
There are little terrace houses, semi-detached houses, and bungalows.
VERY few people live in landed homes in Singapore, and even fewer live in beautiful Bungalows surrounded by beautiful old trees.
Buying a landed property in a land-scarce city like Singapore is the most valuable property assets a Singaporean could ever dream of owning.
There are only 66,000 odd landed properties in Singapore.
Buying one and owning an old building (if you can get one) would cost a bare minimum of SGD2.1M, and renovating it will cost another SGD 900K.
The most prestigious type of landed housing in Singapore is a bungalow house due to the Urban Redevelopment Authority (URA) stringent planning constraints.
The best known are the Nassim, Cluny, Bishopsgate, and White House Park estates.
There are some new ones with hefty price tags if you’re thinking of getting a landed bungalow.
Home Costs In An American Suburbs
According to NeighborhoodX’s analysis, the average price per square foot in Manhattan currently sits at $1,773.
In comparison, San Francisco is a distant second with $1,185 per square foot, followed by Boston at $751 per square foot and Los Angeles at $451 per square foot.
The price per square foot is generally lower than in the city for property in the suburbs.
For the same price, you will be able to get a larger property than you would get in the city.
In the suburbs, the average cost to build a new 2,000 square foot home comes in at $289,952, which places the costing at $150 per square foot.
What Are The Pros And Cons Of Property Investment Suburbs In America?
Buying an investment property in the suburbs is an excellent choice for the right investor.
You may be more likely to find long-term tenants who will enjoy living in the same home for a more extended period of time.
The tenants are mostly families and with school-going children, they tend to stay put.
However, to find these types of suitable tenants, you may be competing with many other similar properties from a smaller prospective tenant pool.
Here are eight pros and four cons of suburban investment properties.
Pro No.1 – Less Turnover
Families view the suburbs as more of a permanent location than the city.
Renters or buyers in the suburbs are looking for stability and the familiarity of living in the same place.
Most people here are looking to buy a home or rent one for longer than two years.
For newlyweds and couples starting a new family with a newborn, they will like to rent a home in the suburbs so that their child can grow up and attend school in that neighborhood.
Pro No.2 – Less Wear And Tear
It is easier to find long term renters in the suburbs.
Many will sign a lease for more than two years.
Since they plan on living in the property for some time, they tend to see it more as a home.
As such, they will be more respectful of the property and create less wear and tear.
Pro No.3 – More Space / More Bang For Your Buck
The average cost to build a new 2,000 square foot home cost around $150 per square foot in the suburbs.
This is approximately $300,000 for a landed property.
About SGD405, 690 or MYR1, 230,000
I am sure we cannot find this kind of cost to build a bungalow in Singapore or Malaysia.
Pro No.4 – Great Outdoor Space
One of the main draws of suburban living is having lots of outdoor space for your loved ones. Games, picnics, BBQ, yard sale, you name it.
Pro No.5 – Lower Crime Rates
Safety is a big concern for renters and buyers, and typically, suburbs have lower crime rates than cities or urban areas.
Pro No.6 – It’s Quieter
A home in the suburbs is a welcome respite from the hustle and bustle of city life.
While living in an isolated rural area may not be appealing in case of emergencies.
Their search continues for the perfect balance of urban and suburban life.
Pro No.7 – Easy Access To The City
Many suburbs are located within an hour of a larger city.
This gives the residents access to the entertainment and nightlife and keeps them connected to the city easily.
Pro No.8 – Higher Median Income
Typically suburban households are often made up of multiple income earners.
The residents may have a bigger budget than single working individuals.
Are there any challenges to the suburb-lifestyle? Of course, there are. We’ve listed the cons below.
Con No.1 – Fewer Tenants
For property owners who focus on rental properties, you should be aware that there are fewer tenants in the suburbs.
Most residents are homeowners. However, this does not mean that no one in the suburbs is looking to rent.
People in the suburbs generally look to rent apartments, single-family homes, or multifamily homes.
You need to understand what tenants in the area want first before investing.
You would want to buy the property or renovate your property to appeal to them.
Con No.2 – Less Variety Of Investment Properties
The majority of properties in the suburbs are single-family homes.
In some areas, you may find two-family homes. Apartment buildings or large multifamily homes are less common.
There will be a limited number of office and retail spaces available.
Con No.3 – Less Public Transportation
If you don’t own a car or don’t drive, living in the suburbs may restrict your choice of buying groceries and necessities.
This will be a significant setback for those who do not have their own transportation to live a distance away from a railroad or bus line. Well, there’s still Uber!
Con No.4 – Limited Activities
Some may view the suburbs as dull as the amenities could be limited to a single mall, a few restaurants, and a movie theater.
You can be quite lucky if you’re into doing some sports with the community or go swimming in a nearby river.
Different areas have different amenities.
How To Buy A Home As A Property Investment Suburbs In America?
Let’s out what you can do with SGD338,000 or MYR1Million.
Let’s convert that to USD; it’s about USD250K.
At Noble Sky, we have helped our investors to create something unheard of in Singapore and Malaysia.
I have purchased a home in a Government County auction for USD60K.
In fact, we have done this several times.
The property is a single-story house with
- 3 Bedrooms
- 1 Bath
- 1 Lounge
- 1 Dining
- 1 Kitchen
- 1 Washing Machine and Dryer Room.
There is a broad field at the back of the property with 1 Garden Shed.
The cost of rehab using three local Contractors was USD20K.
The time the Contractors took was 30 Days.
The property cost, bought at USD60K + rehab USD20K = USD80K.
The property resold at USD130K.
The profit is a cool USD50K!
As these property owners decided to flip it (resell it on the market), there was no expansion to the house.
As you can see, this exercise cost about USD80K for the first property.
Imagine doing this over and over again.
You will probably buy three similar-sized properties in the same locality in the USA with USD250K.
You can choose to flip two of the properties and live in one as a vacation home.
You will still make up to USD100K on the other two properties.
This is how far USD250K will possibly work out for you in terms of investment.
How is this possible, you ask?
Rauf Said teaches the concept of using other people’s money so they can purchase Liens, Lands, or Properties for ZERO Down Payment.
Keen to know more?
Register to attend a two-hour FREE workshop conducted by Rauf Said himself to determine how this can be done.
I want to invite you to respond if you are interested to learn how to own an investment property in the USA.